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Halal mortgage???

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Halal mortgage???
Stephanie
10/06/04 at 22:09:38
[slm]

Anyone know of a way to get an interest free loan in the US?  My husband and I have been looking for houses but I am starting to have serious second thoughts because I don't want to pay interest.  Also, if we move into a two or three bedroom apartment, we will end up paying as much or more than we would on a morgage. Isn't this a form of usury?  The home/apartment owner is making much more money off of the renter than what they pay, and the property was purchased off of interest to begin with.  What to do? >:(

[wlm] :-)  
Re: Halal mortgage???
dina
10/07/04 at 06:29:06
[slm]

have a look at this site
http://www.amanahfinance.hsbc.com/amanah/hsbcaf.nsf/Pages/GroupStrength

from what i understand, the bank will buy the house you are interested in and sell it to you at a higher price
so in the end it is like any other morgage, ie in the amount you repay
however the scholars have said this is halal because it does not deal with interest.

wassalam
Re: Halal mortgage???
workingmuslimah
10/07/04 at 09:36:56
The Metro Credit Union in the Toronto area is apprently bringing out a "shari'ah compliant" mortgage, and ISNA has a long-running housing co-op program for house purchases.

It seems that you end up paying a lot more than you would with a "conventional" mortgage, though.

Unless you can pay cash for a home (what a dream!!) or find a friendly rich Muslims to give you an interest free loan (ditto only more so...) it feels like we're really in a bind. Get a conventional mortgage and worry about sinning by engaging in riba (certain fatwas notwithstanding) or pay through the nose to do it in an "Islamic" fashion and feel annoyed at having to pay so much more...

I'm looking forward to reading what others have to say.
Re: Halal mortgage???
bhaloo
10/07/04 at 21:04:57
[slm]

I'm not so sure how Islamic these places are that claim to be doing it the "Islamic way".  Here is the way they operate.  You go into a partnership with them into buying a house.  Let's say you put 50% down and they put the other 50%.  So you each own 50%.  What they then do is RENT you their share of the 50%.  And you can pay some principal towards this so their ownership goes down, i.e. 49%, 48%, 47%, ...., until eventually you own the whole thing, you have 100% and they have 0%.  Now the thing is, they will do it over a period of 15 years, 20 years, even 30 years, just like a conventional loan.  Just like a convential loan, they AMORTORIZE it over this period.  Now this amortization business is what is upsetting, because most of the money you are paying towards the "rent" portion (just like an interest loan) in the early years of this "loan".  Hardly any money is going towards buying back the house.  And as was mentioned their rates are ridiculous, much higher then a standard conventional riba based loan.
Re: Halal mortgage???
Saam
10/08/04 at 12:10:38
[slm]

MashaAllah, if every Muslim looking for a house was as determined as the people here to not go to war with Allah and His Messenger (SalAllahu alayhi wa sallam), then a truly halal solution to buying a house will arise.  InshaAllah, something is bound to happen when Muslims are all living in apartments due to refusal to pay riba...
Re: Halal mortgage???
jannah
10/08/04 at 12:13:09
[slm]

Friends of ours just got a house using Guidance Financial.. They were advertisers at this year's ISNA as well. I think they are based in NJ so check them out inshaAllah :)
Re: Halal mortgage???
Stephanie
10/08/04 at 17:56:49
[slm]

JazakAllah Khair brothers and sisters for your reply.  I looked at the websites for both of the organizations listed above.  Unfortunatly, Guidance Financial does not offer any programs in our state. My husband is in the process of contacting the Amanah group inshAllah.  I plan to ask the Muslims around here to find all of our options.

[wlm] :-)
Re: Halal mortgage??? [halal death tax]
SuperHiMY
10/09/04 at 14:09:42



  My website, http://www.IslamBank.com  is/was the largest islamic banking website.

  For the first time in 8 years, it is down. Trying to figure out the error.

  http://www.Lariba.com  (use internet explorer, it'll crash mozilla)

  Mortgage is a latin word for death tax.

  American Finance House aka Lariba.com  at the moment is the better option
  for muslims in U.S. states where they're allowed to operate.

  If there is a resident expert on Jannah.org viz Islamic Banking/Takaful,
  I imagine I'm it.

  You ask me specific questions in this thread, I'll answer directly.

  Specify if you just want the short answer-answer, or the long reason-answer.

Re: Halal mortgage???
Stephanie
10/09/04 at 15:01:24
[slm]

Alhumdullilah, HiMy, I'm glad there's a resident expert on Jannah.org.  I checked out the Lariba.com site and they do operate in my state.  Do you know how long it generally takes to deal with this company?  I watched the ABC segment on the site and it said generally it takes around nine monthes for families to get a loan the Islamic way.  We' ve got one child and another on the way and have to move out of our one bedroom apartment soon.  I'm seriously considering moving into an apartment for the next year or so.  

[wlm] :-)
Re: Halal mortgage???
SuperHiMY
10/10/04 at 17:03:30


 Salam,

 There was/is a muslim who works at Fannie Mae in upper management.

 Three years ago, Fannie Mae decided to support (ie GIVE money) to Lariba.com.

 The segment was shot before that decision.

 Approvals with Lariba (American Finance House) now take, depending on the state
 you are in, from two to four days.

 Exceptions exist of course, but the last time I spoke with the chairman the average was four days for approval, 30 - 60 days for closings.

 In other words, the paperwork, approval, and ownership transfer take about the same time with Interest-Free housing as it does with Satan-based Usury financing of property.

 Freddie Mac also underwrites Lariba.com.

 About a quarter billion dollars in interest and riba free house financing has been done, probably more by now. The stats in my memory are dated now.

 If Lariba.com don't work out for you,

 There are at least 5 other interest free housing companies that may be able to help you, depending on your u.s. state and your unique circumstances.


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